As to those who claim QE ended, and other nonsensical ignorant claims, that is irrelevant. The money went to reliquify the broke banks' balance sheets, and so of course did not immediately leave their digital vaults. That takes time, and we are slowly (technically not at all slowely) watching the destruction of the dollar's purchasing power via mass inflation, beginning with the assets closest to the money printing spigot: real estate, stocks, fine art, and other elite assets.
Inflation is the rise in overall price level, not the increase in a few select asset classes. We aren't seeing inflation. The people who have been making that claim for 5+ years have been wrong. Period.
Declaring mass inflation for the dollar doesn't seem to align with how CPI is evolving though, and it's not like the dollar is losing much ground to foreign currencies. If standard purchases haven't changed much, and purchasing abroad hasn't changed much, could we say that things have changed much?
Though you're saying slowly, maybe I'll ride the bubble til it bursts just like the rest of 'em.
Depends on how leveraged it is.
It seems a more appropriate statement would be destruction of all currencies purchasing power. Which leads me to wonder - what is the impact of that exactly?
Should the dollar be allowed to strengthen greatly (relatively to basket of all other currencies), is that what people are proposing? Can we guess at what the dollar based economy might do in that instance?
A nifty chart that shows this idea in a 3D graph:
http://www.nytimes.com/interactive/2015/03/19/upshot/3d-yiel...
Hence you're incentivised to put it into assets. Basically you're not seeing assets (houses/stock) going up in value, you're seeing money go down in value.
My theory is that it has become far too easy (profitable) for middlemen to extract that value from people when they are attempting to invest. Maybe some academics should look into expanding the Principal-Agent problem[1] into the Brokerage-Agent problem. Most brokerages don't care whether the value of an asset goes up or down, only that the trade takes place so that they get their cut. This is what exacerbates the problem, not zero interest. Realtors are especially adept at convincing buyers to bid up properties based on their future value. Securities brokers know that when fear and hype push volume in either direction, it has been a good day; it doesn't really matter if it ends red or green because they get cut whenever trades take place, regardless of whether people are cashing in or cashing out of the market. Quantitative-based profiteering on volatility.
US QE stopped in October of 2014.
Why is this bad? Where else should you put your investment dollars, if not into assets?
Disclaimer: These aren't my ideas, i'm merely parroting. But i thought they were clever and worth sharing.